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AMERICAN ITALIAN PASTA COMPANY -NEWS
-RELEASE
Contact:
George Shadid -
EVP & Chief Financial Officer
816-584-5621
gshadid@aipc.com
FOR IMMEDIATE RELEASE
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American Italian Pasta Company
to Withdraw and Restate Historical Financial Statements
KANSAS CITY, MO, October 27, 2005 -- American Italian Pasta Company (NYSE:PLB)
announced today that it has determined that certain of the Company's historical
financial statements should no longer be relied upon. The Company also announced
that as soon as practical after conclusion of its ongoing Audit Committee
investigation, the Company anticipates filing restated financial statements for
the affected periods.
On August 9, 2005 the Company announced that it had identified impairment
charges and other adjustments that would be recorded in the Company's financial
statements. The Company announced at that time that it would continue to review
its financial statements and would assess whether and to what extent these
adjustments corrected errors in prior reporting periods.
Since the August 9th announcement, the Company has continued to identify
information and undertake analyses that have led it to conclude that its
previously issued audited consolidated financial statements for the fiscal years
ended October 1, 2004, October 3, 2003 and September 27, 2002, and its unaudited
consolidated financial statements for each of the fiscal quarters during such
years, should no longer be relied upon. In addition, the Company has concluded
that its unaudited financial statements for the first two quarters of fiscal
year 2005 (ended December 31, 2004 and April 1, 2005) should also no longer be
relied upon. The Company's determination results from its conclusion, based on
its ongoing review, that errors relating to the accrual of allowances for
product promotions and capitalization of certain overhead costs (in both cases,
as disclosed in the August 9th announcement), when combined with certain
uncorrected immaterial errors, had a material impact on the Company's historical
financial statements. The Company continues to review its historical financial
statements, including with respect to the matters disclosed on August 9, 2005,
-more-
AIPC
October 27, 2005
Page 2
and the Audit Committee's investigation is ongoing. The Company's restated
financial statements may also reflect other adjustments for errors in addition
to those identified above. The Company has discussed the determination that
these historical financial statements should not be relied upon with its
independent registered public accounting firm, Ernst & Young LLP, which concurs
with this determination.
The Company is continuing to gather information and may determine in the future
that the consolidated financial statements for fiscal periods prior to 2002
cannot be relied upon.
As soon as practical following completion of the Audit Committee's
investigation, the Company expects to prepare restated financial statements for
the periods in question and file appropriate corresponding amendments to its
periodic and annual reports previously filed with the Securities and Exchange
Commission. As previously disclosed the Company has not yet filed its Form 10-Q
for the third fiscal quarter of 2005, which was due on August 10, 2005.
Founded in 1988 and based in Kansas City, Missouri, American Italian Pasta
Company is the largest producer and marketer of dry pasta in North America. The
Company has five plants that are located in Excelsior Springs, Missouri;
Columbia, South Carolina; Tolleson, Arizona; Kenosha, Wisconsin and Verolanuova,
Italy. The Company has approximately 600 employees located in the United States
and Italy.
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